Tue September 10, 2013
2014 Austin City Budget Holds Line on Tax Rate (Update)
Update: For the first time since 2007, the Austin City Council has voted to lower the city’s property tax rate. The council finalized the fiscal year 2014 budget this afternoon.
Granted, the tax rate hasn’t fallen by much: two-hundredths of a penny (from 50.29 to 50.27 cents) for every $100 dollars of valuation. For the owner of a $200,000 home, that amounts to a savings of 40 cents a year. Mayor Lee Leffingwell had pressed for a bigger cut.
“I think it’s important to show our commitment to affordability, our commitment to fiscal responsibility,” Leffingwell said. “It’s an opportunity that rarely comes and who knows when it will come again.”
Update (Sept. 9, 5 p.m.): While it looks like Austin’s property tax rate isn’t going up, the Austin City Council is still wrestling with how to spend $3.3 billion in the city’s 2014 budget.
Just after returning from lunch this afternoon, the council voted to maintain the current property tax rate – a reduction from what city staff proposed.
It’s been a day of trading. Before the somewhat surprising, unanimous decision to keep the tax rate constant, the council freed up over $13 million by accepting more optimistic revenue projections, and acting on several expense-cutting suggestions it had asked city departments to develop. (Here’s a list of several budget adjustments that formed the basis of today’s negotiations.)
Although the council came around to his call to keep Austin’s tax rate constant, Mayor Lee Leffingwell voted against a series of spending measures the council proposed for the surplus.
“There are a lot of things on this that I would really like to be able to vote for,” he said. “They are great causes. There’s also a long list of things that aren’t on this list that are great causes, too, but we have to make our best effort, I believe, at trimming spending.”
In addition to funding for several city initiatives the budget contains a 1.5 percent pay raise for staff, plus a $750 one-time payout per employee.
Original post (9 a.m.)Beginning today, the Austin City Council starts a series of votes to adopt the city’s proposed $3.3 billion budget for the next fiscal year.
In several years past, the budget was largely finalized at this point. But there’s plenty of signs this year may be as tense as last – when negotiations went down to the very last minute.
In order to operate, city government needs an approved budget in place before the fiscal year begins October 1. That’s why after every department has shared its unmet needs, and after money has been moved from one pot of cash into another, and after the community has offered input – there’s still the chance the budget will not be finalized today.
Here’s a few things to watch for as council starts making the sausage:
- Any Shift on Public Safety?
Public safety – police, fire and EMS – make up about two-thirds of the city’s overall budget. Council member Bill Spelman has long held that Austin Police could budget smarter – by hiring a couple fewer patrol officers, and more crime analysts, for instance. It’s a drum he’s beat each budget season. This year was no exception – Spelman put together a slideshow demonstrating that while police ranks have swelled, crime stats haven’t. “We actually cleared more crimes in 1999 than in 2013,” Spelman said, “despite the fact that the number of, at least general assignment, detectives more than doubled.”
Could his argument make any headway? There are signs Austin’s informal city policy of two officers for every 1,000 residents may see some flexibility this budget.
- More funding for parks?
While Public Safety has consumed most increases to the General Fund – the $800 million pot of money that pays for city services – advocates for other departments aren’t staying quiet.
One group, Great Austin Parks, was formed just to advocate for expanded parks funding.
Retired attorney Richard Craig says for years parks were “funded for failure”. So, this year, for the first time, they developed a strategy. “We had to run a political campaign,” Craig says.
They showed up at meetings, and spoke at every opportunity. And the council listened. There are no guarantees – but Craig is optimistic the council may increase funding by $4.5 million. “The response that we’ve gotten from council members: We are going to get you some help,” Craig says. “We are gonna either get all of this done or most of this done.”
- A tougher look at fee waivers?
Few Austin voices have been as tough on City Manager Marc Ott’s proposed budget – the template council members were given to work with – than the Austin-American Statesman. The daily has called Ott’s budget a “double hit,” noting that even without a tax rate increase (which Ott’s budget contains), Austin residents would still pay higher property taxes due to rising property values.
To that end, the Statesman argues it's time the City Council stop offering “freebies” to organizations and events like South by Southwest, Circuit of the Americas and the Texas Relays, in the form of fee waivers and public safety overtime. Will it be an argument with legs?
- Leffingwell holds line on rate increase – will others?
Joining the Statesman in the fight against a tax rate increase has been Mayor Lee Leffingwell. He’s on the record as opposing any budget with a rate increase, asking “If we can't hold the line on taxes when our economy is doing better than almost anybody's in the country, when can we hold the line?”
With the switch to single-member districts in 2014 set to upend politics at City Hall, it will be interesting to see how the current council members most often mentioned as potential mayoral candidates – Sheryl Cole, Mike Martinez and Laura Morrison – vote when it comes to a tax increase.
You can watch budget deliberations on the city website, beginning now (Monday, 9 a.m.). If it can't finish today, the council has Tuesday and Wednesday to finish adoption of the budget.
Keeping an eye on things? Let us know what you’re watching for in budget deliberations.